Analysis of Unilever's Internationalization and Competitive Advantage

This report examines Unilever's internationalization strategies and how the company maintains a competitive advantage in global markets. It begins with an introduction outlining the research aim, objectives, and questions, followed by a literature review exploring themes such as internationalization, methods used in the retail sector, and the challenges of maintaining a competitive edge. The analysis section delves into Unilever's use of foreign direct investment, joint ventures, and exporting strategies. The report also discusses the research methodology, including research type, approach, philosophy, data collection, analysis, reliability, validity, limitations, and ethical considerations. The secondary analysis reveals Unilever's global operations and its use of diverse strategies like joint ventures and exporting. The report highlights the importance of internationalization for Unilever, emphasizing its role in expanding market share and profitability. Different modes of entry used by Unilever are also discussed, including joint ventures and exporting, along with their benefits such as increased productivity and access to new markets. The report concludes with a comprehensive overview of Unilever's approach to international business and its strategies for sustained competitive advantage.

Global Economies and
International Markets

Table of Contents
INTRODUCTION...........................................................................................................................1
Background of the study.........................................................................................................1
Research aim and objectives..................................................................................................1
Research questions.................................................................................................................2
Rationale of the study.............................................................................................................2
LITERATURE REVIEW................................................................................................................2
Theme 1: To understand about internationalisation...............................................................2
Theme 2: Method that are used by business for internationalisation in context of retail sector.3
Theme 3: Challenges and importance related to internalization faced by company while
maintain and sustained competitive advantages.....................................................................4
ANALYSIS......................................................................................................................................4
RESEARCH METHODOLOGY.....................................................................................................6
Research Type........................................................................................................................6
Research Approach.................................................................................................................7
Research Philosophy..............................................................................................................8
Data Collection.......................................................................................................................8
Data Analysis..........................................................................................................................8
Reliability and Validity..........................................................................................................9
Research Limitations..............................................................................................................9
Ethical Consideration.............................................................................................................9
REFERENCES..............................................................................................................................10
APPENDIX ...................................................................................................................................11
BUDGET.......................................................................................................................................11
TIMELINE.....................................................................................................................................12

Topic: Internalization and competitive advantage. A case on Unilever
INTRODUCTION
Background of the study
To become international or global, companies make important decisions to reach greater
and competitiveness in order to make the way the strategy is implemented to maintain and
sustain competitive advantage of international enterprise. On one hand, the company might
decide to become fully integrated in foreign market. On the other hand, the company might
decide to hire independent distributors for attracting new clients. The importance of
appropriately choosing entry strategies into international market of Unilever, having great
impact on its international operations, affecting company decisions and future performance of
Unilever on foreign market. This research proposal will shed light on the research tools and
techniques that can be used in analysing the effectiveness of international entry strategies in
order to maintain competitive advantage. Apart from this, the research proposal will highlight
timeline within which the investigation will be completed.
Research aim and objectives
Aim
The aim behind initiating proposed study is to analyse the internationalization and the
way Unilever can maintain and sustain competitive advantage.
Objectives
By taking above mentioned aim into consideration, following objectives have been prepared:
 To develop understanding about internationalization.
 To identify approaches of international used by companies in retail sector.
 To analyse challenges related to internalization and its significance while maintaining
and sustaining competitive advantage in the context of Unilever.
 To recommend internalization strategies that could be used by Unilever in order to
maintain and sustain competitive advantage.
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Research questions
Q.1 What does meant by internationalization?
Q.2 What are the different approaches used by company in international market to maintain and
sustain competitive advantage in retail sector?
Q.3 What is the importance or challenges related to internationalisation that are faced by firm
while maintaining competitive advantage in Unilever?
Q.4 What is the effectual strategy for Unilever related to expansion of business in international
market so that company can enjoy maximum market share for many years?
Rationale of the study
The main reason for doing this research is to evaluate effective international business of
Unilever in order to maintain and sustain its competitive advantage. This is considered as
research issue because nowadays, managers faced two critical issues while running the business
globally i.e. to protect their home market and second is strengthen their market presence
internationally. For confronting these kinds of issues, company have to creatively select
internationalization approach and designing an appropriate international marketing involvement
strategies in order to preserve competing benefits. Thus, through Thematic perception test
technique the scholar will shed light on effectual international market entry strategies of the
Unilever.
LITERATURE REVIEW
Theme 1: To understand about internationalisation
From the point of view of Panibratov (2017), with globalization and better
interconnection between countries, companies are planning to expand their business across
worldwide. In other words, organization to influence more and more customers make use of
different internationalization approach. For internalization manager needs to plan action or steps
that are undertaken by firm to enter into new market or foreign countries so that it can add new
customers and attained its goals. Manager of international business devote high time, efforts in
order to formulate effective strategies related to the way company can enter into foreign market.
It undertakes appropriate market research in order to analysis key trends, situation in external
environment so that particular steps can be taken to achieve end goals. Moreover, it states that
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manager takes various decision like target market, model of entry and goals of target market
regarding the entry mode.
On contrary, another author states Tran (2019), that manager of international business
needs to have more knowledge, information regarding foreign market like its policies, social
preferences and technology. Companies while entering into international market needs to abide
to all legal procedure so that it can grow and sustain in market for longer time frame. Therefore,
manager by considering all such factors decide strategies for expansion of firm across
worldwide or internalization and retained competitive advantages.
Theme 2: Method that are used by business for internationalisation in context of retail sector
As noted by Broocks and Van Biesebroeck (2017), there are various internalization
strategies which could be used by company in order to grow and expand its business operations
in different parts of world. Franchise, direct exports, joint venture, partnership and merging with
company are some of the internalization approaches or strategies that are used by business to
achieve its end goals. The author has further states that direct export is most common and
effective strategy to enter into international market as company need to spend less amount of
capital to grow its business in new market. Partnership is another enter strategies used by
international business to enter into foreign market as it helps in sharing of resources, associated
risk. It is most suitable strategy in case company is planning to enter into complete market that
have different culture as local partners have completed knowledge of the condition. Thus,
appropriate strategies can be used by international organization to grow and sustain in new
market for longer run.
As per view point of Guo, Yu and Gimeno, (2017), another method used by organization
for internationalization is Franchising which is mostly suitable for enterprise that have
repeatable business model which could easily transferred into other markets. Organization by
making use of franchising strategy of internationalization can easily expanded its business
operations without requiring much capital. It also contributed in minimizing growth risk so,
recently most of the business are motivated to make use of the franchising strategy in order to
attain its objectives. Buying a company is method that are used by business for international
expansion as in it firm buy or purchase another organization that have local presences so that it
can easily operate and sustain its business operations for longer time frame. Therefore, all these
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are different method that can be used by enterprise in order to expand its business operations in
foreign countries to gained competitive advantages.
Theme 3: Challenges and importance related to internalization faced by company while
maintain and sustained competitive advantages
As stated by Shaffer and et.al., (2019), there are various challenges that are faced by
companies in internationalization in order to add more and more customers and enjoy maximum
market share. Such as limited availability of resources that is capital which is required for
expansion of business into new foreign country. Thus, higher cost is one of the biggest
challenged that is faced by companies in retained its competitive advantages and internalization
for different purposes. Rules and regulation made by government also acts as an barrier in
international expansion or sustainability of business for longer term in new market condition.
Different countries have different rules and regulation which need to be considered by company
while expanding its business into new market to grow and survive for many years. High number
of competitors in foreign market is also one of the challenges in internalization and competitive
advantages as firm are facing issue in making use of effective strategy that could help it in
enjoying maximum market share.
According to Rosenbaum (2017), numerous reason clearly states important of
internationalization for organization like it helps in company in planning in advance the way it
can make the best use of available opportunities and avoid associated threat. It also helps
manager in identifying several steps that could be used to expand its business operations in
international market so that it can select best possible alternative for benefit of firm. The author
also states that company by making use of different marketing strategies can maintained and
sustain its competitive advantages in foreign country for many years. Thus, it helps in enhancing
overall profitability and market share of organization in competitive market and contribute in
achievement of end goals.
ANALYSIS
From the secondary analysis it can be understood that Unilever has worldwide
operations therefore it has make use of different strategies in order to expand its business into
foreign market so that it can grow and sustain for longer time frame. Company have make use of
foreign direct investment method to expand its business in foreign countries or internalization its
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business as it has opened its stores across worldwide so that people can easily come and make
purchase. It is also understood from secondary analysis that Unilever owned more than 400
brands which contribute in adding more and more customers in the organization around the year.
Home care, personal care and food and refreshment are three main division that has been used
by organization in order to meet needs of diverse individual and achieve end goals in limited
time frame. So, it can be illustrated that different internalization strategies has helped company
in sustaining its business in foreign market for many years. Within the considerations of
Unilever resources and its objectives, foreign market strategies are developed in terms of
economic opportunity and political risks present in different country market space. In general
terms the internationalisation approaches can be grouped under Joint venture, Exporting,
Licensing, Contract manufacturing, Management contracting and Investing (Watson IV, 2018).
Different modes of entry used by Unilever are:
Joint Venture: In joint venture, company share its ownership, profits, risks and control of the
business with local business persons (Grøgaard, 2020). Unilever has announced its joint venture
with Pepsi Co in order to expand its international partnership for the marketing in order to
maintain and sustain competitive advantages. Unilever takes various advantages after doing joint
venture as it helps the business to grow faster internationally, increased the overall productivity
of the organization and shows greater profits within smaller time frame. Access of two different
markets increase the capacity of the organization which helps in achievement of competitive
advantage. With the help of joint venture Unilever shares its risks and expenses with the Pepsi
Co. which helps them in increasing their market share internationally. Joint venture also helps
Unilever to access new and advanced knowledge with including expertise staff members.
Advancement of technologies and finance helps Unilever at the time of business collaboration.
Exporting: Two options that are available to any organization are Direct exporting and Indirect
exporting. Direct exporting execute the activities that are essential for selling products in
international market while indirect exporting consists of no specific activity and the company
requires an intermediary while performing the activity (Munoz, 2017). Unilever export activities
contributes towards elevating the consciousness of international standard quality products in
order to sustain ambitious benefit. Expansion in export activities helps the Unilever in
significantly expanding the market share and the company became less dependent on an
individual market. For exporting the products the company have to elaborate the production
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level which helps in leading larger economies of scale and offer better margins to the companies
of Unilever as well as the Pepsi Co. Export also helps in the advancement of products according
to different culture people review which ultimately helps the organization to gain its overall
profits because ultimately the aim of the institution is to maximize the profits of the
organization. As export increases the company had to hire new employees which also solve the
purpose of social responsibility of Unilever towards the society. The earning capacity of the
employees also increases after the Unilever adopts exporting activities into consideration.
However, it is a very well-known and established company and deals with export services since
from very long duration of time. Unilever exporting activities also helps the expansion of
country's overall GDP, as export brings money into the country.
Foreign Direct Investment: Foreign direct investment made by a company in one country to
another country after analysing its business interests and to achieve long term and short term
goals and objectives of the organization in order to achieve competitive advantages. Generally,
FDI takes place when an institution takes over foreign business possession and establishes
overseas enterprise operations. Foreign direct investments are very much beneficial for Unilever
in terms of increased capital inflow, competitive market space, balance of trade improvements,
higher forex reserves etc. The main feature of FDI is that it never effects domestic investments
unfavourably (Stanwick, 2020).
RESEARCH METHODOLOGY
Research Type
Research type can be classified into two methods i.e. Qualitative and Quantitative.
Qualitative research involves the collection of non-numerical data to understand concepts,
experiences and opinions of the study. However, quantitative research methods includes the
numerical, mathematical and statistical measurements to express the concept of this method.
For analysing or evaluating the effective entry strategies in international market, qualitative
research type will be chosen. Research who follows the qualitative methods is informative in
nature and generally seeks to explain question phenomenon in order to direct the scholar in a
particular context. In addition to above, the importance and challenges regarding entry strategies
while maintaining competitive advantages will explained through theoretical approaches which
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will be conveyed through qualitative inquiry. This research intent to understand with the help of
primary experiences, faithful reporting and actual conversations of scholars. This particular
research method uses observation as the data collection process because it helps in initiating
detailed description about the topic chosen for the research.
Research Approach
In order to evaluate the methods of entry in international market which influences the
company in maintaining competitive advantage, inductive approach will be applied. It is
basically a process of using examples and observations while completing the research and reach
towards the conclusion of the proposal. In this report we constantly use a mixture of pre-defined
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Illustration 1: Online research methodology
(Source: Understanding research online, 2019)

theories to explain the valid answers of research questions. We will also place our practical
findings in the context of effective international market entry strategies which continuously
moving between theoretical and applicable results for our project analysis.
Research Philosophy
Research philosophy can be divided into two philosophies i.e. Interpretivism and
Positivism. For the present study, interpretivism philosophy will be used for evaluating the
effective international market entry strategies which also helps in analysing qualitative data. The
interpretivism follows qualitative data techniques such as case studies, group discussions,
problem solving activities and other actions to execute objectives of the research. Advantages of
making use of positivism philosophy is that it is mostly suitable for quantitative data value as it
is more trustworthy and done in scientific method. At the same time positivism follow well
defined structure which helps in effective understanding of information that has been gathered
through research. On the other hand there are some of disadvantages such as it involve
inferences of human behaviour at the same time it is highly inflexible.
Data Collection
For addressing research objectives, data collection will be completed through both the
sources i.e. Primary and Secondary. In this project we will use secondary research method for
data collection. Secondary data is a data which has previous existence to the case study and
could be used in theoretical part of our report. Electronic and paper printout articles, books,
journals, internal company reports, documents and web pages of the company are helpful
sources to collect secondary data for the study. Secondary data will also gathered in the form of
company materials which includes broacher, corporate websites, booklet and leaflets of the
company. These sources intensify reliability and increase the credibility of the data collection.
Data Analysis
For analysing the responses collected through secondary data collection method, scholar
will utilize thematic perception test technique. This technique helps professional in analysing
broad range of issues and used to research certain topics with respect to scientific discipline. The
effectiveness of qualitative data will be analysed with the help of thematic perception test
technique.
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Reliability and Validity
In order to execute the trustiness of the case study, we will consider the aspects of
increasing reliability and validity. For ensuring the reliability of the report we will consider the
articles, books, journals, etc. which are published after 2016. Further, by taking into account the
research topic, we will consider the copyright protected data sources to complete our research
project. It is an essential component to ensure that the data are correct and results after collection
of data are accurate in nature and will show exact conclusions which are expected from our
research report.
Research Limitations
Time restraints, limited access to data, money and lack of previous research studies on
this particular topic are acknowledged as main limitations that connected with the current study.
Due to limited time duration and limited portion of money, study restricts the usage of data
analysis through SPSS tool. However, to avoid such limitations, thematic analysis will be done
and the secondary source of data collection will be selected while keeping in mind the reliability
and validity point.
Ethical Consideration
All data which will be provided by us in this report are accurate and true. We will act in
full professional manner while collecting the data from various sources and will not misuse the
data of the company in any illegal way. Sensitive data of the organization will not be taken in
our examination. Appropriate resources will be used while conducting the research. At the end
of this study, we will add all the references to display that the work is not copied from
somewhere else and copyright sites is referred to complete this project.
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REFERENCES
Books and Journals
Broocks, A. and Van Biesebroeck, J., 2017. The impact of export promotion on export market
entry. Journal of International Economics. 107. pp.19-33.
Cohen, B. and Munoz, P., 2017. Entering conscious consumer markets: Toward a new
generation of sustainability strategies. California Management Review. 59(4). pp.23-48.
Grøgaard, B., Rygh, A. and Benito, G.R., 2020. Correction to: Bringing corporate governance
into internalization theory: State ownership and foreign entry strategies. Journal of
International Business Studies. pp.1-2.
Guo, W., Yu, T. and Gimeno, J., 2017. Language and competition: Communication vagueness,
interpretation difficulties, and market entry. Academy of Management Journal. 60(6).
pp.2073-2098.
Koo, and et.al., 2017. Formulating international entry strategies for World Bank consulting
projects through country-level competitive analysis: a vietnam case study. Korean
Journal of Construction Engineering and Management. 18(4). pp.57-66.
Panibratov, A., 2017. International strategy of emerging market firms: Absorbing global
knowledge and building competitive advantage. Taylor & Francis.
Rosenbaum, G. O., 2017. Female entrepreneurial networks and foreign market entry. Journal of
Small Business and Enterprise Development.
Shaffer, L. J and et.al., 2019. Human-elephant conflict: A review of current management
strategies and future directions. Frontiers in Ecology and Evolution. 6. p.235.
Stanwick, P. and Stanwick, S., 2020. International Management: A Stakeholder Approach.
Edward Elgar Publishing.
Tran, H. T., 2019. Institutional quality and market selection in the transition to market economy.
Journal of business venturing. 34(5). p.105890.
Watson IV, and et.al., 2018. International market entry strategies: Relational, digital, and hybrid
approaches. Journal of International Marketing. 26(1). pp.30-60.
Online
Understanding research online, 2019, [Online]. Available
Through:<https://15writers.com/research-onion/>.
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APPENDIX
BUDGET
Expenses Amount in £
Travel 1,500
1) Collection of booklet, leaflets, broacher, etc.
from the organization
500
2) Car rental 1000
Research Equipment 14,200
1) Mobile internet modem 200
2) Cell phones 1000
3) Portable hard drive 500
4) Digital camera 1500
5) Laptop 7000
6) Digital recorders 1500
7) Colour printer 2000
8) Printer ink 500
Research Materials 5,400
1) Cost of mobile internet 1000
2) Cell phone usage charges 500
3) Batteries for digital recorder 400
4) Rechargeable lamps 200
5) Pen drive 300
6) Refreshments 400
7) Gifts for stakeholders of the organization 1000
8) Photocopies 500
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9) Anti virus softwares for laptop 800
10) Stationery items which includes paper,
pen, clips, markers, etc.
300
Publication 4,000
1) Journal application fees 3000
2) Printing and binding of research proposal 500
3) Printing and binding of final research
project
500
Total £25,100
TIMELINE
Activities
/Weeks
1 2 3 4 5 6 7 8 9 10 11 12
Research
Topic
Selection
Research
Aim and
Objective
s
Drafting
Research
Proposal
Analysis
of
Secondar
y
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Resources
Selection
of
Methods
Collection
of
Secondar
y Data
Analysis
of
Collected
Data
Conclusio
n
Recomme
ndations
Arranging
Whole
File In
Structured
Format
Consultati
on With
Tutor
Changes
Done As
Per
Comment
s Given
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By The
Tutor
Final
Submissio
n
14